Demand for various peat moss (Sphagnum peat) types for the Chinese market is stated with an huge sum of 100,000,000 m³ yearly. This quantity will be expected requirements of the Chinese market for the next 5 years.
International peat moss market development in the Asian market.
In fact that it is impossible to cover China’s market growing needs and fully cover this demand.
Have to do by Areapeat.
Company Areapeat has taken a very serious analysis of the situation, having visited China several times with peat product users, distributors, provinces chambers of commerce, port authorities and customs warehouses. As a result of the negotiations, an action plan has been developed for further deployment, with a particular focus on more effective cooperation with end-users as key partners.
1. Build up the basis for long-term relationships in the market.
We will have to fight with shortages. The peat extraction season ended already in September. If the customer wants to order some extra production in December or January, there is probably nothing to offer. It is not possible to increase yields significantly. Loyal customers should be able to forecast next orders volumes for at least 1/2 year ahead. Occasional customers have to be aware that orders may not be fulfilled until the beginning of next season. It can take months.
2. It requires significant changes in supply.
Since certain “boom” is recorded in China and other Asian region countries manufacturers review strategic priorities for peat moss production and export. Focusing on potentially more important markets, we are moving away from the traditional distribution channels in favor of direct contact with end-users. In a way, this could be called the international door to door principle for growing media products as well.
3. New project development.
Peat producers are beginning to invest in the development of trade chains. Thanks to the increased responsiveness of major ports, it is possible to change delivery terms. End-users no longer need to freeze their funds for 3 months. This is the time for producers it takes to complete the order and deliver the goods to the consumer.
The new strategy will allow us to realize a wider range of available products to meet all the needs of professional growers. Likewise, the growing hobby market has not been forgotten.
4. First steps to realize projects.
– approval of import license for import of peat products into China
– contracting with ports and bond warehouses. This is a very important moment to be able to maintain a certain amount of stock with a number of goods for the coming months. It will also allow customers to offer a wider range of substrates that may not have been available or ordered so far.
– direct contact with end-users, such as smart greenhouses, who use a large number of peat substrates ready for use in their nurseries.
All of this will make for more efficient use of company resources and shorten the chain lengths involved in the supply of goods so far.
Main benefits for Chinese peat moss end users.
- full quality control with the support from the Baltic Horticulture Society side
- price transparency and favorable policy
- opportunity to buy goods directly from the warehouse in China
- direct contacts on product orders, assortment and professional consultation with industry specialists (agronomists, technologists, substrate developers)
- opportunity to visit production facilities and peat extraction fields on place.
PEAT MOSS BALTIC.
Approximately 10% of Latvia is covered by peat lands and mires, which include about 6,800 peat lands consisting of raised bogs, fens and transitional bogs formed during the Holocene. There are 1.5 billion tons of peat in the Latvian peat lands, which make up ~0.4% of the global peat resources. Latvia ranks 8th in the world in terms of volume of peat resources per capita. More than 500 peat lands can be used for peat extraction. These contain commercial peat reserves of more than 330 million tons (assuming moisture content of 40%). This includes about 50 million tons in areas prepared for peat extraction, which are 3-4% of all peat lands (Snore, 2004). Source: “Mire stratigraphy and peat resources in Latvia”